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Politics : The Obama - Clinton Disaster
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To: TimF who wrote (66722)3/2/2012 12:04:52 PM
From: DuckTapeSunroof1 Recommendation  Read Replies (2) of 103300
 
Re: "GM likely would have survived without massive aid"

Not bloody likely... without the debt restructuring (enforced by the court) resulting in the haircut to the two biggest embedded costs in it's balance sheets: the pension costs and the debt payments there was no possibility of anything other than liquidation. And it wasn't possible to even survive long enough to make it into bankruptcy court (after the impact of the financial crash) without Bush's loans. And, once in federal bankruptcy court, it wasn't possible to speedily restructure and successfully emerge without the Obama administration's injection of funding for restructuring which resulted in the court granting Debtor in Possession status to the federal government's secured claims.

We know this last part because they TRIED (all over the world) to find investors willing to put up the needed money for restructuring while in bankruptcy court and NO ONE... not any Gulf oil money, not any Hedge Fund, (not even Romney's firm of Bain Capital, supposedly into 'restructuring'), would put up a single solitary dime at that time.

And that was the time when it mattered.

Re: As for the unions, they didn't only get a stake in GM...."

Your 'facts' are incorrect.

The unions have no ownership, were given none.

(The PENSION PLANS, because of their massive claims on the future profits of GM which were much larger than all the bondholder's claims by far, took the pension obligations off of the back of GM and onto their own backs in exchange for an initial 17% ownership of GM. The later secondary public offering of GM stock, which recouped much of the taxpayer's investments, was not participated in by the pension plans and this resulted in diluting their ownership stake down to where it sits today: 10%.)

So the 'unions' as you put it (actually the union-administered PENSION PLANS as I have pointed out - the unions themselves didn't get any) have 10% ownership of GM.

In exchange for that they took tens of billions of secured debt off of the back of the company... a huge haircut without which there could have been no success.
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